An update to the article previously published here, was published at Market Urbanism. The update describes some of the improvements to the zoning code that have been a step in the right direction.
In 2014, we heard a lot more talk about micro-apartments than we saw action. Nonetheless, a few developments promise more than words in 2015. These are the notable projects that will be completed in 2015, or have gone through approvals and construction is expected to be well underway in 2015.
The Panoramic; SoMa, San Francisco
In 2012, Patrick Kennedy’s Panoramic Interests completed a 23 micro-unit project built offsite, which did much to pioneer the development of micro-apartments through the “SmartSpace” brand. Kennedy expects to complete a 160 unit project across from Twitter’s headquarters in June, 2015. 120 of the units will be 275sf studios, with the remainder being micro-suites All units have been leased to local colleges.
My Micro NY; Kips Bay, Manhattan
The media outside of New York often portrays micro-apartments as a “trend” or phenomenon sweeping New York. The truth is, New York City is allowing only one, relatively small micro-unit project through it’s Adapt NYC competition. Instead of updating it’s zoning to legalize the clearly needed product, New York chose to allow one “pilot” project to test the viability of a concept – as if small apartments in New York City is a new innovation.
The winner of the competition was Monadnock Development, which is currently having the 55 micro-units built in a factory in Brooklyn. This year, we will see the units delivered to Manhattan and assembled on the Kips Bay site. Assuming the “pilot” is successful, will the city legalize micro-apartments where 46% of the inhabitants live alone?
WeLive; Crystal City, Arlington, VA
In 2014, Co-working juggernaut, WeWork announced plans to partner with commercial real estate behemoth, Vornado to redevelop a 12 story office building as WeWork’s first venture into residential. The project, which approved in July is planned to include 252 apartments, many being 360sf or less. The units would be organized to share large communal spaces with commercial-grade kitchen appliances. I think the layout and the concept is very compelling. I don’t know much about Crystal City, but I’ve heard some skepticism about the vibrancy of the location.
Latham Hotel; Georgetown, Washington DC
In October, Washington DC approved a new 140-unit micro-apartment development that will include the redevelopment of the Latham Hotel along with an addition. The apartments will be, on average, 330 square feet apiece, and they’ll come furnished. SB Urban is committed to the micro-apartment concept, and plans to bring two other small apartment projects to market: the 90-unit redevelopment of the Patterson Mansion at DuPont Circle, and a 125 unit development at Blagden Alley
Also keep an eye on:
The whole scene in Seattle: While New York makes news by allowing one micro-unit project in the vast metropolis, Seattle has built hundreds of small studios within larger units because of quirks in it’s zoning. However, just months ago, Seattle City Council passed new rules regulating the development of micro-apartments. Developers had thousands of micro-units in the pipeline, and cried that the regulations would significantly throttle development of new units that provided a much need option for single renters. It will be interesting to see how the regulations affect future developments.
Flats #800; Gold Coast, Chicago: Cedar Street Companies recently purchased The Bush Temple of Music, and announced it’s intention to develop it as micro-apartments as part of its Flats brand. Cedar Street has renovated several Chicago SRO buildings as micro-apartments, which have leased up successfully. It should be a challenging renovation, especially if zoning approvals are needed.
The Wharf, Washington DC: According to the developer, Hoffman-Madison Waterfront, about 6 percent of the residential units in the $2 billion waterfront development are planned to be micro-apartments. This means we should expect about 170 total micro-apartments to be completed by 2017.
Turntable Studios, Denver: Nichols Partnership announced they will be converting a hotel near the Denver Bronco’s Stadium into micro-apartments. 168 of the 179 units will be 330sf studios, with the remainder to be small one and two-bedroom apartments.
286 Varick, Downtown Jersey City: When New York created a stir with it’s AdaptNYC competition, Rushmon-Dillon Partnership went right across the Hudson River to find a sight for micro-apartments instead of participating in stiff competition. In September, a judge approved the project after determining the city had improperly pandered to community opposition. The project is expected to include 87 micro-apartments all less than 400sf. I intended to make this project the 5th “Project to Watch,” but information was sparse. If someone has more information on this project, please let me know.
Which projects are you most excited about? Did I miss any important ones?
Several cities have jumped on the bandwagon of building Micro-apartments, a hot trend in apartment development. San Francisco and Seattle already have them. New York is testing them. Even developers in smaller cities like San Antonio and Cleveland are taking a shot at micro-apartments.
At the same time, Chicago is building lots of apartments, and is known for having low barriers to entry, yet we aren’t hearing of any new construction apartments in Chicago. Premiere studios are fetching as much as $2,000 a month. Certainly there must be demand for something more approachable to young professionals. In theory, we should expect to see Chicago leading the way in innovative small spaces.
Chicago doesn’t have an outright ban on small apartments like New York, but there are four regulatory obstacles in the Chicago zoning code that combine to effectively prohibit small apartments:
1. Minimum Average Size: Interestingly, there is no explicit prohibition of small units. This is unlike New York’s zoning which prohibits units smaller than 400sf. There is however, a stipulation that the average gross size of apartments constructed within a development be greater that 500sf. Assuming 15% of your floor-plate is taken by hallways, lobbies, stairs, etc; this means for every 300sf unit, you need one 550sf unit to balance it out.
Source: 17-2-0312 for residential; 17-4-0408 for downtown
2. Limits on “Efficiency Units”: Zoning stipulates a minimum percentage of “efficiency units” within a development. The highest density areas downtown allow as much as 50%, but these are the most expensive areas where land is most expensive. In areas traditionally more affordable, the ratio is as low as 20% to discourage studios.
Source: 17-2-0313-A for residential (20% for RT-4 to 40% for RM6.5); 17-4-0409-A for downtown (20% for D-3 to 50% for D-10+)
3. Minimum lot area: (MLA) Like much of the zoning codes, MLA serves to encourage large units for wealthy families, and discourage more affordable small-sized units. During the condo boom when 2 br condos were the most demanded type of condo, MLA was less important, and floor area ratio (FAR) dictated the scale of projects in Chicago. However, when desiring to build smaller units, MLA dictates the scale instead of FAR. Basically, there is a maximum number of units permitted on a site, based on the size of the site. ULTIMATELY this prevents micro-apartments more than the other 3 factors. Keeping the number of units on a site to a small level, prevents a developer from building micro-apartments at a reasonable density economically, and a developer building larger units will be able to pay more for the land.
4. Parking minimums: The typical person who rents a micro-apartment in a big city does not own a car, and would not need a parking space. Nonetheless, zoning dictates that a developer provide between .5 and 1 parking space for every unit. Structured parking spaces are not cheap to build, complicates design and management, hamper aesthetics, and crowd out open space. Thus, being forced to build significantly more spaces than will be used by the tenants puts a lot of economic pressure on the micro-apartment developer. (not to mention the environmental consequences of building unused and under-used spaces)
Furthermore, a micro-apartment developer with a high number of units would be required to provide on-site parking for all the units. On a constrained site, this means a developer would need to provide at least one level of structured parking, which is expensive to build, especially considering the tenants are unlikely to use the spaces.
Source: downtown: 17-10-0208
There are provisions that allow Single Room Occupancy (SRO) buildings in Chicago. It seems reasonable to conclude that a micro-apartment could be considered an SRO under the zoning code. SRO enjoys a unique categorization, which is exempt from limits on the percent of efficiency units, and are subject to very liberal parking minimums (one space per 10 units). SRO still are subject to the 500sf average and Minimum Lot Area per unit. The 500sf average unit size means the micro-apartment developer must provide a large amount of common space to get the average up, which increases the overall project budget. Furthermore the MLA requirement prevents a developer from building enough SRO units to make the land purchase economical. Thus, SRO are legal, but unlikely to compete economically.
A Chicago developer, Flats Chicago, is currently rehabbing older SROs in uptown Chicago. Redeveloping existing SROs may be the only surefire approach to providing micro-apartments in Chicago. On the downside, redeveloping existing SRO eliminates rare stock of very cheap housing much needed by the city’s poorest residents.
In the end, some major changes need to be made to Chicago’s zoning code to make apartment living more affordable. To start, my suggestion is to eliminate MLA requirements from the code, and significantly liberalize (and eventually eliminate) the parking requirements in all parts of the city. Let’s hope Chicago changes it’s ways, and takes steps towards making city life more affordable.
Not long ago, an article in The Atlantic on the “health risks of small apartments caused a minor stir on the internet. Other sites piled on with hyperbolic headlines: Micro-apartments’ linked to psychological problems, domestic violence and drug abuse (dailymail) and Micro-apartments could make you ‘crazy’ (NYPost)
Wow! Who would want more crazy, abusive, drug users in their neighborhood?
A glance at comments and we see how hyperbole like this succeeds in drawing frothy web traffic from all extremes: right wingers pronouncing micro-apartments are part of an “Agenda 21” conspiracy, to left wingers denouncing “greedy developers.”
After reading some of the health experts on the subject, I suddenly (yet briefly) feared my own small apartment. Dak Kopec speculated that living in a small space can be unhealthy for someone in their 30’s or 40’s – and I’m 38! I do concede that the idea of rearranging furniture as the day goes by, as Kopec mentioned, does stress me out – I couldn’t constantly be transforming my home like some of the small apartment concepts being proposed – I prefer a small, but static home.
Susan Saegert, professor of environmental psychology at the CUNY Graduate Center and director of the Housing Environments Research Group observed that a lack of privacy and cramped living conditions are correlated to children’s difficulty concentrating. Could I be endangering my family’s health after living there comfortably for years?
These are interesting points. Since, I’m not a psychologist, it wouldn’t be responsible for me to debate that. (Psychologists, please reach out to me if you have information on this topic – I want my family to be safe)
Are we really worried about families moving into micro-apartments as small at 200-300sf? I can’t imagine families seeking out micro-apartments unless under special circumstances. There are other great options for families. Micro-apartments are specifically targeted to young, single, professionals, so I think the point is largely irrelevant.
Next, the author takes a troubling detour in the discussion with the psychologist. Saegert shares doubts whether it’s a valid public goal to develop smaller units on city land.
“In New York, property is just gold,” she points out. “Isn’t this something a developer could do in a [Brooklyn] neighborhood like DUMBO and make a lot of money?” By the same token, if micro-apartments are indeed the wave of the future, Saegert argues, they increase the “ground rent,” or dollar per square foot that a developer earns and comes to expect from his investment. So over time, New Yorkers may actually face more expensive housing, paying the same amount to rent a studio in the neighborhood where they used to be able to afford a one-bedroom. With the gradual erosion of zoning rules, the micro-apartment could very well become the unit of the future, the only viable choice for a large number of renters.
I’m completely baffled why The Atlantic included this. It’s sloppy journalism on several levels:
- The statement has nothing to do with health, the subject of the article. This makes me wonder if the intent was to have unbiased discussion of health issues, or draw skepticism towards micro-apartments.
- The author seems to be implying that those who choose bed-roomed homes are a class of people who should be protected at the expense of those who would choose a more meager space.
- Why does The Atlantic allow a professor of psychology to make an economic argument? They don’t mention her credentials on that subject. Wouldn’t it be more credible to find an economist or housing expert to make such an assertion?We’d be pretty confounded to see a housing economist being quoted about nuanced psychological matters.
- There’s a good reason the author couldn’t find someone qualified to make such a statement: this “ground rent” argument is economic sophistry. True, ground rent for that site goes up if a higher rent per square foot is earned. However, because of a smaller unit footprint, twice as many people’s housing needs are met on that piece of ground. Since more people’s desires are met by that piece of land, those satisfied renters would no longer be in the pool competing for the pricier one-bedrooms. Thus, pressure on the price of land for projects with one-bedrooms is relieved, and more people have the homes they desire than if all homes were one-bedrooms. Families rejoice!!
- Let’s just pretend we live in a world where the psychologist is right about the economics of “ground rent”. If induction of higher rents was a justification to forcibly prevent someone from making that living choice, then I can think of a few things that should be a higher priority such as stopping the development of large new construction luxury condos. With prices averaging as high as $5,487/sf, these large units drive land prices higher than micro-apartments ever could. Therefore, according to these ethics, authorities should first forcibly prohibit the construction of large apartments before they go after those who want to live in small apartments. (Of course, I do not advocate this)
- The psychologist concludes that an “erosion of zoning rules” would make micro-apartments “the only viable choice” for renters. This is a misunderstanding of zoning. Zoning, by definition, limits the supply and choice of housing. An erosion of zoning would actually give renters a more diverse choice, and make housing more affordable. Using the same analogy as #5, if Saegert zoning analysis was right, from Harlem to Bushwick, renter’s only choice today would be ultra-luxury condos.
Hopefully, journalists will take more care to report more responsibly about micro-apartments. Especially considering the publications that thrive on alarmist hyperbole are still going to pile on to spread misinformation.